Green Apron, Red Flag? Starbucks Analysts Wonder About $500 Million Investment As Sales Slump

Shares of Starbucks Corp SBUX were under pressure in early trading on Wednesday, after the company Tuesday reported downbeat fiscal third-quarter earnings.

Here are some key analyst takeaways.

• Piper Sandler analyst Brian Mullan reiterated an Overweight rating, while raising the price target from $102 to $105.
• TD Cowen analyst Andrew Charles maintained a Hold rating, while lifting the price target from $90 to $95.
• Oppenheimer analyst Brian Bittner reaffirmed a Perform rating on the stock.

Check out other analyst stock ratings.

Piper Sandler: Starbucks' U.S. business same-store sales contracted by 2%. Meanwhile, the coffee chain will deploy its Green Apron service model to all U.S. stores by mid-August.

This is significantly earlier than what management had previously communicated, Mulla said in a note. The initiative has "the potential to change the traffic trajectory sooner than expected," he added.

Starbucks expects the incremental labor investment in Green Apron to be $500 million. However, it is "actively looking for non-store labor efficiencies across the organization to help offset," Mulla added.

TD Cowen: Starbucks plans to roll out Green Apron labor across its US stores by mid-August and its Assistant Store Manager role in fiscal 2026, Charles said. The company’s $500 million investment is front-end loaded, Charles added.

"This compares to our previous estimate for $700M+ solely for 4Q25-3Q26 Green Apron investments, and based on our conversations is also lower than investors were expecting," the analyst wrote. Management has not provided any insight into how Green Apron impacted sales at 1,500 stores at the end of the fiscal third quarter, Charles stated.

Oppenheimer: Starbucks reported another quarter reflecting pressure on sales and margins, Bittner said. He added, however, that investors remain optimistic that the fiscal third quarter represents a bottom.

The company expects traffic to improve sequentially in the fiscal fourth quarter, after a 3% decline in the previous quarter, the analyst stated. Starbucks’ U.S. same-store sales will likely be flat in the quarter. That’s below Street expectations of 1.4% growth, he commented.

Price Action: As of Wednesday’s publication, shares of Starbucks had declined by 0.59% to $92.41.

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